Growers trade to pay debts

Some coffee growers have been offering the grain in order to pay debts. They usually do this to make new investments for the next crop.

For a while, prices keep moving down. The CEPEA/ESALQ Index for arabica closed at 265.82 reals or 125.33 dollars per bag of 60 kilos last Wednesday, down 4.09 percent in Real or 3.95 percent in dollar during the month. For robusta, the decrease was of 0.82 percent in Real or 0.68 percent in dollar in the accumulated of February, averaging 200.80 reals or 94.67 dollars per bag last Wednesday.

Even with no fundaments of downward trend for this year (the 2007/08 crop was estimated by Conab between 31.1 and 32.3 million bags of 60 kilos for a demand of 46 million bags), according to a great part of agents, there are still around 40 percent of the 2006/07 crop to be traded. Moreover, it needs to be considered the crop of Central America countries.

Players bet on higher prices after debts expiring period. The lower supply, due to the lesser growers' necessity to trade, should support the domestic prices. Moreover, the next crop (2007/08), which starts to be harvest from April on, should come to the market at larger volumes only from July on.

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